Bill Clinton's Surplus: Not Something to Celebrate

In this video you will learn:
– Why we should not celebrate Clinton’s fiscal surpluses
– Why the federal government usually must be in deficit
– Under what condition a government deficit is financially sustainable

English/Nat

U-S President Clinton addressed the nation on the state of the budget on Tuesday just hours before the Senate began discussing impeachment proceedings against him.

He said the budget has shown a surplus for the second year running, a surplus he intends to use to fund social security programs.

SUGGESTED VOICE OVER;

The President said the country had undergone a significant fiscal turnaround since he took office in 1992.

At that time economists were projecting record budget deficits by 1999, not the surplus which he announced on Tuesday.

SOUNDBITE: (English)
“The era of big deficits is over. We are now entering the second year of an era of surpluses. Our economists project that in 1999, we will close out this century with a surplus of not less than 76 (b) billion dollars (U-S), the largest in the history of the United States.”
SUPER CAPTION: Bill Clinton, U-S President

The President said his administration and its economic team deserved credit for the strategy which led to the surplus.

SOUNDBITE: (English)
“The key was doing enough, figuring out enough to get interest rates down because high interest rates were keeping entrepreneurs from starting new businesses or expanding them, they were discouraging young people from buying homes. As has already been said, they were causing grave questions about the leadership of the United States in the rest of the world. Our deficit had become a symbol of the inability of government to play its essential role in American life.
SUPER CAPTION: Bill Clinton, U-S President

The President added that the surplus must be used to guarantee the future of social security for the 21st Century before any consideration could be given to tax cuts or additional spending.

When asked whether the impeachment proceedings would stop him pursuing his economic policies Clinton said there could be no excuses for not dealing with what he believes are the most important priorities in government.

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14 thoughts on “Bill Clinton's Surplus: Not Something to Celebrate”

  1. ok so your saying corporate america ran the books fed ran the rates up caused the recession …zero rates cause bubbles ….negative externality of zero rates not deficits.

  2. the low interest rates and the enormous 2000 bubble caused it and GDP still grew at the time. If their was a deficit at that time U.S would be in such a larger debt right now.

  3. We have been paying off our national debt with a small surplus and we still have our AAA rating in the Netherlands.

  4. You do make some really good points and I like that you look beyond the black and white idea that people seem to have of surplus=good and deficit=bad, but then you also oversimplified it as well and there some things I believe you have wrong. Firstly, you suggest a very strong inverse relationship between the government and the private sector that does not exist. Of course they effect each other but the idea that having a government surplus directly leads to a private deficit is dead wrong. The taxing of the private sectors usually comes at the cost of profit margins for the companies. Now you may argue that the profits would be put to better use if the corporations reinvested it into their own company rather than the govt. using it to pay down the debt, but you cannot say having a govt surplus means the private sector will operate at a deficit. If a company does operate at a deficit, it’s either by choice (Twitter/Facebook) or it’s not a very good company. You can have a surplus and a very good private economy, Clinton has some of the lowest unemployment rates of any administration.

    Secondly, you say that the surplus led to the recession and huge deficits buy bush in the 2008, those two things are also not directly related. A lot of things led to the recession that I’m not going to post here but the surplus is towards the very bottom of the list.

    Thirdly and MOST importantly is the insinuation that we shouldn’t concern ourselves with the national debt and should focus out attention on stimulating the private sector for the sole reason that the govt can print money and the private sector can’t is DANGEROUSLY ignorant. The govt cannot just print money especially on a large scale without large ramifications. That is how you crash economies and cause inflation.

    All in all the budget is a balancing act, you don’t want the govt to tax too much because it can start to mess with private sector and hurt our GDP, but you don’t want to not tax to little because like it or not we do have to pay back the debt. That’s why it’s a debt, it’s money owed.

    (Opinion starts here) I personally feel we should feel much more concerned with paying down the debt then concerning ourselves with the profit margins or corporations. If they used the money from the tax cuts and invested it into the country with more jobs than that’s great, but they move factories to China and pocket the change from the money saved. On the flip slide I also feel like we should also cut govt spending to further increase the surplus instead of just taking money from the “greedy” corporations. But that’s just my personal perspective on it, feel free to disagree

  5. From my viewpoint, part of Clinton's means of 'balancing the budget" was to drastically cut funding to many important Federal agencies including the Dep. of the Interior. This led to the Forest Service and the BLM not having enough funding to manage public lands which were being used to support industries such as Ranching (open range grazing) and Lumbering (timber sales and auctions). Thus as a byproduct of these agencies' inability to accommodate the needs of these industries, we now suffer from the death of lumber in the Pacific Northwest, which not only cost thousands of jobs, but forced the influx of more imported timber. It also truncated efforts on the parts of these agencies to maintain forest lands by allowing timber sales of what I like to refer to as 'fuel forests'; I. e. overgrown and unhealthy forest lands, resulting in massive fuel contributions to fires in most western states. The grazing issues may never be resolved since, ranchers have had to raise only as much herd as can afford to be fed on private land (or pay for feed for larger herds). While I don't at all condone the takeover of public facilities (in Oregon, for example), I understand the frustration of the Ranchers who should have been granted an audience by the Feds to build public understanding of the plight they suffer. One more thing – NAFTA didn't work until the Railroads (and trucking companies) got into a bidding war with each other and slowly lowered their transportation rates to remain competitive. Like Magic! All part of the Clinton legacy. Thanks, Bill.

  6. Won't printing extra money to pay off debts lead to hyperinflation though?

  7. I'll Celebrate it if I want to, U RATHER I CELEBRATE THE BUSH RECESSION , QUIT BEING SO MORBID… Like Fuck Everyone…

  8. One thing you don't seem to be taking into account is the national debt. If we had maintained the surpluses for several more years, the nation's debt could have been significantly paid down.As things currently stand, much of our debt (in the form of treasury bills) is held by foreign actors who could do SERIOUS damage to the US economy by cashing in their trillions of treasuries all at once. This seems much more precarious than slightly smaller GDP growth due to surpluses.

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